Traders welcome registration of shopkeepers’ scheme

ISLAMABAD: The initial response of the traders’ community to the Federal Board of Revenue’s (FBR) new Tajir Dost Scheme, 2024 for small traders and shopkeepers is positive.

Talking to Business Recorder on Sunday, Chairman Supreme Council All Pakistan Anjuman Tajran (APAT) Naeem Mir said that the documentation of un-registered shopkeepers through the Tax Asaan App’s is a positive step, but modalities on collection of minimum advance tax on monthly basis needs to be finalised.

The use of Tax Asaan App would also end the hassle for the traders to hire lawyers and tax advisers and pay them fee for completion of documents and subsequent registration.

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He said that the APAT strongly supports registration of traders’ community without increase in burden or incidence of taxes on shopkeepers. The incidence of taxes should not be increased on small traders and shopkeepers. If the market surveys and registration drive of the FBR goes smooth, it is expected that the new shopkeepers would come into the formal regime without any resistance, Chairman APAT was optimist.

He highly appreciated FBR’s efforts to register professional operating out of the tax net.

He was confident that the Tax Asaan App of the FBR will be able to function properly during the registration exercise on national level.

Chairman APAT stated that the amount being calculated on the basis of the annual rental value of shops is to be determined. Moreover, the “fair market value of business premises” i.e. amount calculated as per the valuation of immoveable properties has to be decided. The question arise adjustable sales tax collected along with electricity bills from traders will be abolished or not, Naeem Mir added.

Ajmal Baloch of All Pakistan Anjuman-i-Tajiran informed that the association is studying the details of the scheme and would comment after analysis of the new scheme for traders. Apparently, the scheme seems to be ok, he added.

Under the new scheme, the FBR has developed the “National Business Registry” i.e. a central repository database of small traders and shopkeepers to be registered under the Tajir Dost Scheme, 2024.

According to the SRO 420(I)/2024, the special procedure for small traders and shopkeepers to be called Tajir Dost Scheme, 2024 has been issued.

This scheme shall apply to the traders and shopkeepers operating through a fixed place of business including a shop, store, warehouse, office or similar physical place located within the territorial civil limits including cantonments in the cities specified scheme for registration and payment of minimum advance tax.

The “shopkeepers” included wholesaler, dealer, retailer, manufacturer cum retailer, importer cum retailer, or such person who combines the activity of retail and wholesale with any other business activity or other person in the supply chain of goods.

The scheme shall not apply to a person being a company or operating as a unit of national or international chain stores in more than one city or a person or a class of persons specifically excluded by the Board. The scheme shall come into force with effect from April 1, 2024 and payment of Advance Tax will be applicable with effect from July, 2024.

The FBR said that all provisions of the Income Tax Ordinance shall apply to the persons specified under this scheme in respect of computation of income for a tax year and tax payable thereon, collection and deduction of tax as provided in the Ordinance, computation and payment of advance tax liability under section 147 of the Ordinance and section 4C and 7E if liable to pay such tax.

Every trader and shopkeeper shall apply for registration under section 181 of the Ordinance or through Tax Asaan app or on FBR’s portal or through FBR’s Tax Facilitation Centres by April 30, 2024.

If a person, who is required to be registered, does not apply for the registration under the said sub paragraph, the Commissioner Inland Revenue shall register the trader or the shopkeeper as the case may be.

Every person shall be liable to pay monthly advance tax. The advance tax paid shall be the minimum tax in respect of income from the business covered under this scheme.

The amount of monthly advance tax for a tax year shall be computed in the manner as may be prescribed.

Where the advance tax computed is zero, the advance tax payable shall be Rs1,200 per annum. Provided that where the income of the person is exempt from income tax under any provision of the Ordinance shall not apply.

The FBR said that the advance tax payable shall be reduced by 25 percent of the whole or the balance if the person pays in lump sum the whole or the balance as the case may be, of remaining advance tax for the relevant Tax Year on or before any of the due dates for payment of such tax under the said paragraph; or if the person who has not filed income tax return, files income.

If the person who has not filed income tax return, files income tax return for Tax Year 2023 before the due date for payment of first monthly installment.

The monthly advance tax payable under paragraph 5 shall be paid with effect from July 1, 2024 for the relevant tax year and the first payment will be due on 15th of July, 2024 and thereafter on 15th of every month.

The tax payable for a tax year shall be paid through a separate Computerized Payment Receipt against the Payment Slip ID (PSID) generated by Tajir Dost module or through FBR’s portal or through FBR’s Tax Facilitation Centres, FBR added.

Copyright Business Recorder, 2024